Update from MGY's Website:
June 12, 2000 Update
Overview
Since the last update in March, Magin issued its? 1st quarter 2000 results. Production averaged 9243 boepd in the 1st quarter 2000, a 6% increase over the 4th quarter of 1999. Along with the production increases, commodity prices remained strong resulting in record financial results for the quarter.
The month of April and the first part of May are generally slow for most oil companies due to the effects of spring break-up. During the "spring break-up" period the local municipalities and provincial authorities place weight restrictions on most road systems thus restricting the movement of heavy equipment. Drilling and service rigs are virtually shutdown and the industry uses this period to perform maintenance and refurbish equipment. With limited drilling and service rig work, Magin utilizes this time to carry out planned maintenance on its oil batteries, gas plants and other oilfield equipment.
Magin spudded its first well of the second quarter in Hastings May 15. This oil well has been placed on production at 175 bopd. Five additional wells have been drilled to date resulting in 2 horizontal oil wells (Ingoldsby & Alliance), one vertical oil well (Alliance) and two gas wells (Three Hills Creek). These wells are currently undergoing completion operations. The two Copton wells cased prior to break-up are waiting on completion.
Drilling
To date in 2000, Magin has drilled 26 wells resulting in 11 oil wells, 14 gas wells and 1 abandonment for an overall success rate of 96%. Magin continues to actively exploit and develop within existing core producing areas. Of the 26 wells drilled, 24 have been drilled within 5 core properties. These core areas contain over 200,000 net acres of undeveloped land. Magin plans to drill an additional 29 wells in these areas by yearend 2000.
In addition to the exploitation and development activity, an aggressive exploration program is underway with plans to drill up to an additional 5 wells at Copton, 3 wells in Medicine Lodge, and a deep Wabamun test at Edson. The first well at Medicine Lodge was spudded on May 28 as part of a three well farm-out commitment from an industry partner to evaluate Magin lands for Viking, Cardium and Belly River gas production.
Copton Project (30 to 50% Interest)
The well logs on 10-10 and 15-17 were very encouraging. Some preliminary tests were conducted on the open-hole section of the 10-10 well which flowed at 3.5 mmcfd without stimulation, the main zones identified on logs have yet to be tested. The next well scheduled is at 15-23 which is a re-entry of an old well bore. Magin and its? partners plan to deepen the 15-23 well and test several new zones plus previously by-passed pay in the upper section of the well-bore.
Line pipe and other key pieces of equipment required to transport the gas to market have been ordered. The pipeline is being designed to handle in excess of 100 mmcfd of sweet natural gas. Production equipment for Phase I of the project has been ordered. First gas is anticipated to flow in November, 2000.
Other Projects
Magin farmed-in on 26 sections of land adjacent to our Alliance producing property . The first commitment well has been drilled and cased. Operations will continue through the 2nd and 3rd quarters to earn additional acreage.
The strong commodity prices have enhanced the economics of a number of projects especially where the infrastructure is owned and operated. Magin will continue to upgrade its project inventory throughout the year and expand the budget where appropriate.
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¸ Magin
Looks very Good!
fIXER |
